Financial well-being is typically the dominating concern when you are tracking your company’s success. But more often than not, employers are making a detrimental mistake when trying to improve financial well-being.
What is this critical mistake that is sabotaging this financial well-being?
Actually, there are 2 mistakes.
1) The first mistake is thinking only of your financial well-being as a company (and not the financial well-being of your employees).
59% of employees feel their companies view profits or revenues as more important than how people are treated (ransdstadusa.com). Employees want to be treated like people, not just assets.
The thing is, financial problems are also employees’ biggest worry – above career, health and relationship stress combined. In fact, 45% of employees say financial anxiety impacts their productivity at work according to a Ramsey Solutions study.
And your employees’ financial well-being directly impacts the well-being of your company.
2) The second mistake (and possibly more critical than the first) is to assume that financial well-being means offering your employees a competitive salary and benefits package.
In fact, 80% of employees agree that financial wellness is an important part of a comprehensive employee benefits package (according to this Ramsey Solutions study).
If financial wellness is an important part of a benefits package, then what does that financial wellness portion entail?
Surprise!: How Your Employees Define Financial Well-Being
Let’s take a look at how your employees define financial well-being or financial wellness according to recent research.
Your employees want more than a salary, vacation and benefits package that gives them financial stability and makes them feel valued.
They want you as their employer to care about their long-term financial health. And they want the knowledge and skills to thrive financially.
Specifically, 73% of employees say they wish their employer offered more resources to help them manage their finances (Ramsey Solutions study).
BreakWell Founder, Tara Kraus, further defines employees’ view of financial well-being based on her many employee assessments over the years. “In my experience, financial well-being is also tied to your feelings of worthiness. If you know your worth, you can negotiate a salary based on your value and skill set. But more importantly, if you understand your purpose in and value to your community and company, you will not compare yourself to others’ salaries, bank accounts or material possessions. This, in turn, allows you to connect with yourself and with others on a deeper level, also nurturing emotional and social well-being.”
Though Tara creates corporate well-being programs based on her 8-pillar approach, she agrees with this quote from the book, Well Being: The Five Essential Elements.
“If you want to improve your Financial Well-Being, first make sure your Career Well-Being and your Social Well-Being are thriving. If your daily work is fulfilling and your relationships are strong, you are substantially less likely to get caught up in this comparison dilemma. And you won’t be as tempted to keep up with the proverbial Joneses.”
Offer Financial Well-Being Care Your Employees Will Admire
If you want to improve your company’s financial well-being, don’t spend all your time crunching numbers looking for major discrepancies or areas you can fix. Instead, start investing in your most valuable asset – your employees – as a regular practice.
First, make sure your employees fully understand what their health benefits, educational reimbursement and any investment options include.
Next, offer workshops or sessions to teach your employees skills to improve their financial well-being, such as how to:
- Budget
- Overcome debt
- Take advantage of available tax credits or financial aid opportunities
- Make other investments
- Plan for parenthood or college expenses
- Create short-, mid- and long-term savings
- Create a financial plan
- Plan for retirement
Also, consider how people use money today!
“New generations (particularly Gen Z and millennials) are choosing not to have bank accounts, even though they could obtain them,” says George Mavrantzas, ADP VP of Strategy and Thought Leadership. “This is mainly due to the convenience factor of alternative pay methods such as paycards.” (adp.com)
Use innovation to make it easier for your employees to access their money!
A third mistake many companies make is to create wellness or well-being programs they think their employees will love but end up never using. Companies lose a lot of time, money and resources when this happens – along with productivity and even employees.
To avoid this mistake, hire a third-party provider such as BreakWell to objectively assess your employees’ needs and then create a program they will use and love.
As one example, experienced advisors who are part of BreakWell’s Professional Partner Network will host personalized workshops on your site. These workshops will help your employees navigate the complexities of budgeting, planning and investing. These advisors can also teach your employees how to tackle today’s money challenges and develop strategies to meet their financial goals through retirement.
“When employees feel more financially secure and supported by their employers, they can be more engaged in their work and less likely to search for a new job,” explains Tara.
Investing in Employees’ Well-Being Naturally Improves Your Company’s Well-Being
Of course, as a profitable business owner, you need to manage your company’s bottom line. But when you prioritize improving the well-being of your humans, your company’s well-being will naturally improve too.
With reduced financial stress and improved financial well-being, your employees will be less distracted and more productive. Lower turnover and fewer safety incidents will increase your company’s profitability.
Check out these stats from Gallup.
Employees who strongly agree that their employer cares about their overall wellbeing, compared with other employees, are:
- 69% less likely to actively search for a new job.
- 71% less likely to report experiencing a lot of burnout.
- 36% more likely to be thriving in their overall lives.
- 3x more likely to be engaged at work.
- 5x more likely to strongly advocate for their company as a place to work and to strongly agree they trust the leadership of their organization.
The right well-being initiatives will be life-changing – for your employees and your company as a whole. You can nurture a workplace founded on trust and respect, reduce your company’s risk and create company-wide resilience.
And if designed by BreakWell, your “employee care” program can help you create an impact that goes beyond your workplace.
Tara Kraus emphasizes, “Through our assessments, BreakWell has learned that people mostly enjoy spending time with their family and friends. So we like to design well-being programs that improve employee’s financial health and allow them to create meaningful moments with their family and friends, not just with co-workers.”
If you would like to talk to Tara to discuss how BreakWell’s approach can give you and your employees a financial well-being upgrade, contact her today.